Kerala power tariff hike of over 30% to hit industries: CII

KOCHI: Kerala State Electricity Regulatory Commission's decision to hike the power tariff by over 30 per cent for all categories of consumers in the state would drastically hit core industries, Industry chamber CII said today.

CII is planning to request the state government to come up with industry friendly manufacturing policy and Power Policies, which can facilitate industrial growth and also serve to attract investments into the state, it said.

The increased power tariff change will adversely affect industrial operations of the manufacturing sector in the state, Umang Patodia, Chairman, Taskforce on Power, CII Kerala State Council said in a statement here.

This would adversely affect the businesses, thereby shifting the burden to the general public, who are dependent on this sector, he said.

Power is the major input for the manufacturing and MSME industry. Large-scale manufacturing companies consuming large scale power such as minerals, paper, textile are hardest hit. As it is, generally in Kerala, cost of sourcing raw material and source of employment is significantly higher compared to neighbouring states, he said.

Patodia said increase in power tariff would also drastically affect sustenance and growth of the manufacturing sector in Kerala and most certainly lead to the eventual closure of many of the units.

To support the growth and sustainability of existing industry, 'tariff shocks' have to be avoided and any revision of power tariff must be in a graded manner over a three year period, making it viable for the industry to survive.

Moreover, the current electricity tariff per unit is far higher than the cost of the same to the KSEB. This goes against the cross subsidy directions given by the Central Regulatory Authority, he said.

With the main objective of the proposed 'Emerging Kerala' road shows being to showcase investment opportunities available in the state, CII believes the government and the authorities need to ensure both the manufacturing and power policy which can attract both domestic and international investments to the state, he said.